FC for Victoria road PPP

A road in Victoria has reached financial close, becoming the first PPP deal to use a bond financing solution in Australia since the 2008 global financial crisis.

The Victorian government and the Netflow consortium have sealed financial arrangements for the Western Roads Upgrade project. 

The team – which consists of Cintra (50%), Plenary (50%), WBHO Infrastructure as design and construction lead, with Amey and Broadspectrum as services contractors – will design, build, finance and maintain the project under a 20-year concession. 

Westpac, Bank of China, ICBC and Mizuho are providing 40% of the finance package, with senior secured notes through a US Private Placement covering the remaining 60% as bonds. The project is the first to use greenfield bonds in Australia since the global financial crisis in 2008. 

The project involves eight road and intersection upgrades and widenings, nearly 30km of duplicated road and over 260km of rehabilitation and maintenance in the west of Melbourne. 

ACE Contractors, Civilex, Fortunato, Negri Contractors and Winslow are acting as sub-contractors. 

Works are set to begin in the first half of 2018. Netflow secured the $1.8bn contract in November.  

The Victorian government has recently signed a contract for a toll bridge PPP.